Asia-Pacific’s largest lodging trust, CapitaLand Ascott Trust (CLAS), which is managed by Singapore-listed CapitaLand Investment, has launched JPY 16.5 billion ($111 million) sustainability-linked bonds in the global hospitality sector in partnership with International Finance Corporation (IFC).

Under its S$2-billion ($1.4 billion) multicurrency debt issuance programme, the instrument has a 1.05% fixed coupon rate per annum and will be paid twice a year in arrears, according to a press release.

IFC, which is a member of the World Bank Group, is the sole subscriber of the instrument.

The proceeds from the seven-year bond maturing in November 2019 will be used to refinance existing borrowings and decarbonise CLAS’ serviced apartments in Southeast Asia, including Ascott Jakarta in Indonesia and Ascott Makati and Somerset Millennium Makati in the Philippines.

The three projects are poised to reduce its electricity consumption by 40.5% by December 31, 2028, in line with its parent company’s pledge to reach net carbon zero by 2050. CLAS aims to obtain IFC’s Excellence in Design for Greater Efficiencies Certification within the same period.

“We place sustainability at the core of everything we do. Dovetailing our financing efforts with our environmental, social and governance efforts further affirms our commitment towards responsible growth,” said Serena Teo, CEO of CapitaLand Ascott Trust Management Limited and CapitaLand Ascott Business Trust Management.

“To date, CLAS has raised about S$450 million through sustainable financing. CLAS continues to collaborate with like-minded stakeholders in the financing and investment community to fight climate change through our collective efforts. Currently, 35% of CLAS’ portfolio is green-certified and we remain on track to green 50% of our portfolio by 2025 and our entire portfolio by 2030,” Teo added.